CANARA BANK (E-SYNDICATE BANK) vs MS SARVESHWAR CREATION PRIVATE LIMITED on 18 March 2026

**FINAL ORDER**

This original application has been filed by the applicant bank on 29.12.2020 before DRT-II Delhi and then transferred to DRT-I under Section 19 of Recovery of Debts Due to Banks and Financial Institutions Act, 1993 against the defendants for recovery of a sum of Rs.7,53,06,450.99 (Rupees Seven Crores Fifty Three Lacs Six Thousand Four Hundred Fifty and paisa Ninety Nine only) as on 01.12.2020 along with pendentelite and future interest @14.25% per annum with monthly rests plus @2% penal interest from the date of filing this application till the date of its realization and costs. Further, the name of Mr. Gaurav Mathur was substituted as authorized representative of the applicant bank in place of Mr. Sanjeev Sharma, erstwhile AR of the applicant bank.

2. The brief facts of the case are that on the request of the defendant no.1 through its directors i.e. defendant no.2 and 3 in the business of manufacturing of garments and its exports, the applicant bank sanctioned SODH limit for Rs.495.00 lacs (Rupees Four Crores Ninety Five lacs only) on 10.02.2016 @12.20% interest per annum as working capital against hypothecation of stock, plants & machinery, book debts and other current assets of defendant no.1 and collateral security of property at Sector-64, Noida owned by defendant no.5. The defendant no.4 and 5 stood as Corporate Guarantors for the credit facility sanctioned in favour of the defendant no.1.

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3. That in order to avail the credit facilities, the defendant no.1 through its directors submitted loan application dated 09.02.2016 and executed Sanction Letter dated 10.02.2016, Composite Hypothecation Agreement, Confirmation of Deposit of Title Deeds, Comprehensive Pre-Shipment & Post Shipment Agreement, Power of Attorney for Collection of Book Debts and Letter of Undertaking in favour of the applicant bank on 11.02.2016 towards applicant bank. The defendant no.4 and 5 signed and executed Guarantee Agreement on 11.02.2016.

4. That in order to secure the credit facility, the defendant no.1 through defendant no.2 and 3 hypothecated the stocks including raw material and finished goods, plant & machinery, current assets and book debts as well as defendant no.5 created mortgage of their property being land and building bearing no.A-38-I, Sector-64, Noida, Uttar Pradesh with the applicant bank and executed confirmation of Deposit of Title Deed/ Mortgaged by Deposit of Title Deed dated 11.02.2016 .

5. It has been submitted by the applicant bank that after availing the credit facility, the defendants failed to comply with the terms and conditions of sanction and failed to regularize the account with the applicant bank despite regular follow up and reminders. Ultimately, the applicant bank classified the account as NPA on 28.09.2018 as per RBI guidelines due to non-adherence to financial discipline and issued legal notice dated 07.02.2020 but defendants failed to regularize the account, hence, the applicant bank approached this tribunal for recovery of their dues.

6. Notices under section 13(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002 dated 09.01.2019 and possession notice dated 14.03.2019 u/s 13(4) of SARFAESI Act duly affixed. The *Sd-*

applicant bank moved application before District Magistrate, G.B.Nagar, Lucknow to get the possession of secured assets under Section 14 and obtained order on 23.10.2019. It has further been submitted that the defendants filed SA no.652/19 on 18.09.2019 before DRT Lucknow.

7. Notices of this O.A. were issued to the defendants and despite proper service the defendants have chosen to absent from the proceedings. As per order dated 17.11.2023, the defendants have been proceeded ex-parte as they have not appeared before the Tribunal nor written statement, evidence and affidavit of assets have been filed.

8. On the application filed before NCLT by borrower company, the adjudicating authority declared moratorium under Section 13(1) (a) of the Code, thus, borrowers company has been made only Performa Party and this application has been filed against the guarantors only for relief and no relief has been claimed against defendant no.1.

9. In order to prove its case, the applicant bank has filed its evidence by way of affidavit of Sh.Sanjeev Sharma, authorized representative of the applicant bank who has proved the documents such as Power of Attorney, Loan Application Form and Proposal Forms, Copies of documents qua Intended SOD loan, Sanction Letter, Composite Hypothecation Agreement, Guarantee Agreement, Confirmation of Deposit of Title Deeds, Comprehensive Pre-Shipment and Post Shipment Agreement, Power of Attorney for Collection of Book Debts, Letter from Borrower, Letters & Undertakings, Acknowledgement Letter, SOD Letter, Demand Notice, Invocation Notice, Possession Notice, Copy of Order issued by District Magistrate, Legal Sd- Notice alongwith Postal Receipts, Loan Account Statements and Certificate u/s 2A read with Section 65B marked as Ex.PW-1/A to Ex.PW-1/T.

10. The applicant bank has fully corroborated the averments made in the O.A. Even otherwise the whole case of the applicant bank is based on the documents and the same have been duly proved.

11. The case filed by the applicant bank gone unrebutted and there is no question of disbelieving the case of the applicant bank and the applicant bank has proved its case beyond reasonable doubts.

12. In the light of the above discussions, the Original Application deserves to be allowed.

ORDER

I, allow this OA and direct the defendants to pay to the applicant bank within a period of 30 days, jointly or severally, a sum of Rs.7,53,06,450.99 (Rupees Seven Crores Fifty Three Lacs Six Thousand Four Hundred Fifty and Paisa Ninety Nine only) as on 01.12.2020 along with pendentelite and future interest @14.25% per annum with monthly rests from the date of filing this application till its realization with costs; failing which the aforesaid amount shall be recovered from the sale of hypothecated stocks, book debts, plant & machinery and mortgaged property i.e. land and building bearing no.A-38-I, Sector-64, Noida, UP-201301. In case of shortfall, the same shall be recovered from the sale of movable and immovable properties of the defendants.

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(II) The recovery certificate be issued forthwith and be sent to the Recovery Officer, Debt Recovery Tribunal-I, Delhi.

(III) Parties are directed to appear before Recovery Officer, DRT I, Delhi on 18.05.2026.

(IV) Copies of final order as well as Recovery Certificate be sent to all concerned free of cost.

*Sd-* *026* **(GOVIND BALLABH SHARMA)** **PRESIDING OFFICER** **DRT-I, DELHI**

(Dictated and pronounced in open court) Dated: 18.03.2026